Shell finally pays out £55 million over Nigeria oil spills

A massive oil spill in the oil-rich Niger Delta in 2008 has caused years of environmental and economic devastation. But only after legal action in London has Shell been forced to reveal the truth, admit liability, pay compensation, and begin the clean-up.

Shell needs to provide proper compensation, clear up the mess and make the pipelines safer, rather than fighting a slick PR campaign to dodge all responsibility.

Six years after two oil spills destroyed thousands of livelihoods in the Bodo area of the Niger Delta, legal action in the UK has driven Shell to make an out-of-court settlement of £55m to compensate the affected community.

The £55m will be split between £35m for 15,600 individuals and £20m for the community.

The compensation is an important but long-overdue victory for the victims of corporate negligence, said Amnesty International and the Centre for Environment, Human Rights and Development:

"While the pay-out is a long awaited victory for the thousands of people who lost their livelihoods in Bodo, it shouldn't have taken six years to get anything close to fair compensation", said Audrey Gaughran, Director of Global Issues at Amnesty International.

"In effect, Shell knew that Bodo was an accident waiting to happen. It took no effective action to stop it, then it made false claims about the amount of oil that had been spilt. If Shell had not been forced to disclose this information as part of the UK legal action, the people of Bodo would have been completely swindled."

Mutiu Sunmonu, Managing Director of Shell's operating company in Nigeria, said: "From the outset, we've accepted responsibility for the two deeply regrettable operational spills in Bodo. We've always wanted to compensate the community fairly and we are pleased to have reached agreement."

But the pollution remains today

The wait has taken its toll on Bodo residents, many of whom had their fishing and farming livelihoods destroyed in the spill. Throughout this time they have had to live with the ongoing pollution and, without compensation, many have faced grinding poverty.

"The compensation is a step towards justice for the people of Bodo", said Styvn Obodoekwe, Director of Programmes of the Centre for Environment, Human Rights and Development (CEHRD).

"But justice will be fully achieved when Shell properly cleans up the heavily polluted creeks and swamps so that those who rely on fishing and farming for their income can begin to rebuild their livelihoods"

Shell has always accepted that the two 2008 Bodo oil spills were the fault of failures on the company's pipeline at Bodo, but publically - and repeatedly - claimed that the volume of oil spilt was approximately 4,000 barrels for both spills combined, even though the spills went on for weeks.

But in 2012 Amnesty International, using an independent assessment of video footage of the first oil spill, calculated that the total amount of oil split exceeded 100,000 barrels for this spill alone.

Shell is "fully committed to the clean-up process", said Sunmonu. "Despite delays caused by divisions within the community, we are pleased that clean-up work will soon begin now that a plan has been agreed with the community."

Court action forces Shell to disclose the ugly truth

During the legal action in the UK, Shell had to finally admit that its figures were wrong and it had underestimated the amount of oil spilt in both of the Bodo cases. However Shell has still not confirmed how much oil was actually spilt.

During the legal process Shell was also forced to reveal that it had been aware, at least since 2002, that most of its oil pipelines were old, and some sections contained "major risk and hazard". In a 2002 document Shell stated that outright replacement of pipelines was necessary because of extensive corrosion.

As far as Amnesty International and CEHRD are aware, Shell took no action despite having this information years before the Bodo leaks. Shell repeatedly blames illegal activity in the Niger Delta for most oil pollution but its claims have been discredited in research by Amnesty International and CEHRD.

An internal Shell email from 2009 revealed that Shell knew it was exposed over spills in Ogoniland - where Bodo is situated; the email stated "the pipelines in Ogoniland have not been maintained properly or integrity assessed for over 15 years".

"I am very happy that Shell has finally taken responsibility for its action", says Pastor Christian Kpandei, a Bodo fish farmer, whose fish farm was destroyed by the oil spill. "I'd like to thank the lawyers for compelling Shell to make this unprecedented move."

But thousands more people remain at risk of future oil spills because of Shell's failure to fix its ageing and dilapidated pipelines. Hundreds of oil spills from Shell's pipelines occur every year.

Background

Two oil spills occurred at Bodo in the Niger Delta in 2008, the first in August and the second in December. Amnesty International and CEHRD have worked on the Bodo spills case since 2008, supporting the community to secure compensation and clean up.

In 2011, the people of Bodo, represented by UK law firm Leigh Day, began court proceedings in the UK against the Shell Petroleum Development Company of Nigeria.

"Oil pollution in the Niger Delta is one of the biggest corporate scandals of our time", said Audrey Gaughran. "Shell needs to provide proper compensation, clear up the mess and make the pipelines safer, rather than fighting a slick PR campaign to dodge all responsibility."

But Sumonu insisted: "Unless real action is taken to end the scourge of oil theft and illegal refining, which remains the main cause of environmental pollution and is the real tragedy of the Niger Delta, areas that are cleaned up will simply become re-impacted through these illegal activities."

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